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Coca-Cola Enterprises Inc (NYSE:CCE)
Beneish M-Score
-3.04 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Coca-Cola Enterprises Inc has a M-score of -3.04 suggests that the company is not a manipulator.

CCE' s 10-Year Beneish M-Score Range
Min: -4.69   Max: -0.74
Current: -3.04

-4.69
-0.74

During the past 13 years, the highest Beneish M-Score of Coca-Cola Enterprises Inc was -0.74. The lowest was -4.69. And the median was -2.55.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Coca-Cola Enterprises Inc for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 0.8457+0.528 * 0.979+0.404 * 0.9823+0.892 * 0.9062+0.115 * 0.9074
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1+4.679 * -0.0577-0.327 * 1.1024
=-3.04

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $1,637 Mil.
Revenue was 1928 + 1631 + 1925 + 2136 = $7,620 Mil.
Gross Profit was 705 + 568 + 669 + 808 = $2,750 Mil.
Total Current Assets was $2,855 Mil.
Total Assets was $8,706 Mil.
Property, Plant and Equipment(Net PPE) was $2,008 Mil.
Depreciation, Depletion and Amortization(DDA) was $294 Mil.
Selling, General & Admin. Expense(SGA) was $1,777 Mil.
Total Current Liabilities was $2,819 Mil.
Long-Term Debt was $3,712 Mil.
Net Income was 176 + 96 + 112 + 238 = $622 Mil.
Non Operating Income was -1 + 2 + -7 + 0 = $-6 Mil.
Cash Flow from Operations was 203 + 158 + 391 + 378 = $1,130 Mil.
Accounts Receivable was $2,136 Mil.
Revenue was 2333 + 1870 + 2032 + 2174 = $8,409 Mil.
Gross Profit was 846 + 650 + 688 + 787 = $2,971 Mil.
Total Current Assets was $3,295 Mil.
Total Assets was $10,168 Mil.
Property, Plant and Equipment(Net PPE) was $2,304 Mil.
Depreciation, Depletion and Amortization(DDA) was $302 Mil.
Selling, General & Admin. Expense(SGA) was $1,961 Mil.
Total Current Liabilities was $2,866 Mil.
Long-Term Debt was $4,053 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1637 / 7620) / (2136 / 8409)
=0.2148294 / 0.25401356
=0.8457

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(568 / 8409) / (705 / 7620)
=0.35331193 / 0.36089239
=0.979

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (2855 + 2008) / 8706) / (1 - (3295 + 2304) / 10168)
=0.44141971 / 0.4493509
=0.9823

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=7620 / 8409
=0.9062

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(302 / (302 + 2304)) / (294 / (294 + 2008))
=0.11588642 / 0.12771503
=0.9074

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(1777 / 7620) / (1961 / 8409)
=0.2332021 / 0.23320252
=1

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((3712 + 2819) / 8706) / ((4053 + 2866) / 10168)
=0.75017229 / 0.68046814
=1.1024

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(622 - -6 - 1130) / 8706
=-0.0577

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Coca-Cola Enterprises Inc has a M-score of -3.04 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Coca-Cola Enterprises Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.92831.09721.00390.99952.23270.83770.84581.06091.03860.9931
GMI 1.01151.02151.03561.033410.99871.00991.01681.03210.9688
AQI 0.99350.90651.00270.55341.53261.030.95251.0131.03860.9643
SGI 1.03041.05661.05721.04160.29881.03021.23380.97321.01861.0063
DEPI 0.97471.0460.96310.94661.11221.2180.84460.9981.08930.9027
SGAI 0.99390.98720.96370.99060.79641.01380.96921.01470.96980.9968
LVGI 0.97161.09610.94341.48960.38521.55371.12611.06861.09211.1163
TATA -0.04330.0077-0.0131-0.3847-0.0321-0.0233-0.0121-0.0287-0.0168-0.0365
M-score -2.71-2.35-2.45-4.57-1.66-2.86-2.54-2.59-2.49-2.73

Coca-Cola Enterprises Inc Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 1.01840.99241.11581.03861.0421.22961.03070.99310.87160.8457
GMI 1.01771.02541.03161.03211.02341.00010.98010.96880.97050.979
AQI 1.00621.01561.01211.03860.99340.96220.99950.96430.95650.9823
SGI 0.96820.98561.00711.01861.02341.05221.0341.00630.97490.9062
DEPI 0.99361.03611.07941.08931.10661.10250.9720.90270.86040.9074
SGAI 1.04581.02971.01440.96980.91930.93890.94870.99681.02961
LVGI 1.14011.12591.13351.09211.0831.09211.06951.11631.14081.1024
TATA -0.0517-0.0278-0.0232-0.0168-0.0165-0.0157-0.0149-0.0365-0.0519-0.0577
M-score -2.78-2.65-2.49-2.49-2.49-2.32-2.52-2.73-2.96-3.04
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